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California Cpas

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What are the four major classifications of tax practitioners, and why do most people choose CPAs? In California, you can do your taxes with a CPA, a lawyer, an unenrolled agent or an enrolled agent. Let's examine the differences among these various practitioners, so you'll have a better understanding of how to prepare your finances and talk intelligently about your taxes.

In order to qualify as an "unenrolled" preparer, you merely have to complete a tax course and a few annual updates. You don't need a college degree to become an unrolled repairer--however, you must register first with an organization known as the California Tax Education Council. According to both anecdotal and statistical evidence, service provided by unrolled preparers varies widely, probably because these practitioners aren't particularly well regulated.

Tax Preparation Specialists
Enrolled agents (EA), on the other hand, must take and pass a fairly comprehensive test on California taxes and tax preparation. This test is given by the Internal Revenue Service. Some enrolled agents are former IRS employees. These agents don't have to take the test, as long as they prove their technical proficiency in the real world for at least five years.

Attorneys can also help you prepare your taxes. Unlike unenrolled or enrolled agents, attorneys must pursue extensive schooling (including college) and take annual tax law update courses in order to maintain status. Yet while tax attorneys are by and large adept and as efficient as CPAs in terms of navigating the tax system, the good ones are incredibly expensive. For detailed cases, you may have to pay as much as $400 an hour for an attorney's services.

The Tough AICPA Membership Requirements
California CPAs are held to stringent requirements. They must pass numerous tests, complete college, and take update courses. Remember that not all CPAs specialize in taxes. Look for a CPA practitioner who does--you can contact the American Institute of Certified Public Accountants (AICPA) for more information on someone near you--the AICPA has over 350,000 members.

In recent years, the requirements to maintain membership in the AICPA have become even stricter. In 2000, the governing board of the AICPA ruled that applicants must complete at least 150 hours of secondary (higher) education in order to become members. California CPAs must also pass statewide licensing boards.

Where to Find Good California CPAs
You can contact the California Society of CPAs for a more complete dossier. Some CPAs maintain private accounting shops--others work as agents in part of a larger conglomerate, like H&R Block. For detailed information on the past successes and failures of CPA businesses, you can contact the California Better Business Bureau or check out frank online reviews written by taxpayers like you.

To facilitate your tax preparation, you should organize your bookkeeping as much as possible before meeting your CPA or other tax practitioner. The more organized you are, the less time your tax agent will need to work out the details of your account. Since most tax preparation agents charge a significant amount per hour, you can save as much as $200 to $300 with a few minutes of bookkeeping.

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